Woven carbon fiber (CF) laminae are functionalized in situ with carbon nanotubes (CNTs) to test the hypothesis that growing CNTs on CF (i.e., carbon fiber bundles or tow) would enhance the properties of polymeric carbon composites, specifically epoxy–carbon composites that are used in aerospace applications. The CNT as-grown on the woven CF were shown to substantially improve the fracture toughness of the cured composite on the order of 50%. This was accompanied by no loss in structural stiffness of the final composite structure. In fact, the flexural modulus increased approximately 5%. The significant increase in the fracture toughness as tested under the ASTM D 5528 standard indicates that the damage tolerance of a composite structure would benefit from the CNT material applied in this way. Our approach has allowed for significantly larger samples to be uniformly functionalized with CNTs than is reported elsewhere in the open literature. In addition, this work demonstrated CNT functionalization on flexible substrates that remains flexible after functionalization, whereas most CNT growth substrates are rigid in order to withstand the high (>800 C) growth temperatures often encountered in CNT synthesis.